Nakamura has Budget Answers?

In a March 4, 2013 letter to the City Council, Brian Nakamura wrote: “I believe that the financial condition of the City of Hemet can be verified on-line, along with the fact that it was also confirmed during the interview process.”

I went and looked this up, as Brian suggested. Recent news articles have reported there is an ongoing deficit in the Hemet general fund; however, according to the mayor we can’t really believe what the media reports. Fortunately I had also gone to the official City of Hemet website and downloaded Nakamura’s 2012-13 Budget Message to the City Council that pretty well spells out what happened there.

Here are some quotes from that document:

“In FY 2008-09 the City utilized approximately $3.9 million of the General Fund reserve.”

“For FY 2009-10 alone, the Council approved approximately $1.6 million in expenditure reductions, employee concessions and revenue enhancements. Despite these efforts, the continued drop in resources required the City to use virtually all of its remaining reserve of approximately $2.5 million to balance the FY 2009-10 budget.”

“Adoption of the FY 2010-11 budget, once again, includedmeasures to eliminate a deficit, this time of approximately $5 million, through more cuts to positions, employee concessions and acceptance of public safety grants.”

“In the current FY 2011-12 budget, the City’s General Fund finally saw a healthy reserve of over $12 million and a structurally balanced budget due to a citywide reorganization, employee contributions toward pension costs, and, most significantly, the franchise of the City’s in-house refuse operation…which provided the City with an up-front payment of $12.5 million and ongoing payments of at least $3.34 million annually for the next twenty years.”

“Preliminary FY 2012-13 Budget.The presented budget included a combined general fund structural deficit of approximately $3.5 million, as a direct result of the loss of the City’s Redevelopment Agency and Public Safety grants. Of the approximate $3.5 million shortfall, the preliminary budget utilized approximately $2.1 million in one-time available monies (approximately $1.3 million from excess fund balances from various internal service funds and $800,000 of residual refuse funds), leaving a $1.4 million shortfall to be covered by reserve funds….Closing that gap was achieved (as discussed above) with use of $2.1 million of one-time monies, $1.2 million in expenditure reductions, and use of $199,500 from reserves.”

“If the economy does not significantly improve and/or expenditure are not reduced, the City may find itself facing, at a minimum, an estimated structural deficit in FY 2013-14 in the range of $2.5 million to $3 million.”

To sum up, Hemet did everything Chico had already done and still ended up with a structural deficit in its general fund. Unfortunately, Chico does not have a refuse franchise it can sell for $12.5 million to restore its reserves.

I really urge you to take another look at what is happening to our beloved Chico culture. For the price of Nakamura and his quarter million dollar severance agreement, the Council has sold what is most important about Chico down the river. It is shameful that the goodness of ‘the Chico way’ appears to be headed for ruins — and there is still nothing to sell for $12.5 million.

Thanks for this you guys. I have heard the rumors about what’s happening in Hemet but have not had time to check into the documents.

so, let me get this straight – Hemet sold their garbage operation, and still ended up in the hole? Am I reading that right? I wonder what kind of financial condition that operation was in, what kind of revenues it was bringing in, etc. Here he’s muscling a fee out of the garbage haulers, so they get to muscle us – don’t you hate these rackets?

And, I hate to say it – but we do have something to sell – Bidwell Ranch. I do not want to see that piece of property developed – talk about a major traffic disaster, my mid-town neighborhood already gets the runover from Cal Park! They’ve admitted, they don’t have the money to do the Hwy 32 widening necessitated by other badly planned subdivisions like Meriam Park. Sorensen admitted to me that the city may still be sued by CalTRANS because of this. We need to remind them of that when Gruendl and Sorensen come forward with their plan to sell Bidwell Ranch,

I still have my bright yellow “NO WAY SAN JOSE” paper badge. I made a fridge magnet out of it – never forget.

Yep, you read that right. The document indicates they used the proceeds from selling the garbage franchise to restore their reserve balances. If you have specific questions about the document we posted, we can answer them, but the revenues and profitability of the franchise will require deeper analysis. A full analysis of Hemet’s budget is on our to-do list, but for now, we have pressing business with the recent and ongoing shenanigans at Chico City Hall.

We hadn’t thought about Bidwell Ranch; you make a good point. I was under the impression it was being used as a mitigation bank, but when I looked into it after reading your comment, it seems that plan has not yet been implemented. One thing in your favor is you will have the environmentalists standing alongside you if that comes forward. We will definitely be watching the agendas to see what comes next in Nakamura’s plan.

Speaking of agendas, did you see they called a “special” closed session Monday night? I have some thoughts about what was so important it couldn’t wait until next Tuesday, but of course I would be speculating, and that doesn’t belong here.

I am on the notifications list so the clerk sent me the notice for that special meeting, probably Friday. I had thought about going down there, just to snoop, but I don’t know how.

Once I walked in on one of those meetings accidentally. Linda Dye of Chico PD was quick to get up and tell me to leave! As I left, I encountered Debbie and Dani, with a wheeled catering cart covered with food. They were pushing it up that ramp toward the meeting room I’d just left. I thought that was weird – they cater the special sessions?

One thing that bothers me – they are supposed to keep us informed of whatever happens in those sessions – any offers made by either side are supposed to be made public. I guess I’ll write Sorensen a note and ask him about it.

My question is what so surprised them between Tuesday night’s adjournment and Friday afternoon when the Closed Session agenda was posted that they had to call a special meeting. If they knew Tuesday night that they wanted to meet prior to Sept 17, they should have simply adjourned to Sept 9, so the public knew about it. We are now on that notifications list, so it won’t happen again. And we will be checking with Lori Barker about the public’s right to address the Council prior to Closed Session. Please keep us posted if you get a response from Sorensen.